Range Resources Corporation’s quarterly report for the period ended September 30, 2024, shows a net income of $[insert amount] and a comprehensive income of $[insert amount]. The company’s total assets increased to $[insert amount] from $[insert previous amount], driven by a significant increase in cash and cash equivalents. The company’s total liabilities decreased to $[insert amount] from $[insert previous amount], primarily due to a reduction in accounts payable and accrued liabilities. The company’s stockholders’ equity increased to $[insert amount] from $[insert previous amount], driven by the net income and a decrease in treasury stock. The company’s cash flow from operations was $[insert amount], which was used to fund its capital expenditures and reduce its debt. The company’s financial position and results of operations are discussed in more detail in the Management’s Discussion and Analysis section of the report.
Overview of Third Quarter 2024 Results
In the third quarter of 2024, Range Resources Corporation, an independent natural gas, natural gas liquids (NGLs), and oil company, reported net income of $50.7 million, or $0.21 per diluted common share. This was an increase from the $49.4 million, or $0.20 per diluted common share, reported in the same quarter of 2023. The higher net income was primarily due to increased production, which offset slightly lower realized prices.
Revenue from the sale of natural gas, NGLs, and oil increased 1% from the third quarter of 2023, driven by a 4% increase in production volumes, partially offset by a 3% decrease in average realized prices before cash settlements on derivatives. Including the impact of cash settlements on derivatives, revenue increased 7% year-over-year.
The company’s financial and operating performance in the third quarter of 2024 included:
Range Resources also took several actions in the third quarter to enhance its balance sheet, return capital to investors, and preserve liquidity:
Overview of First Nine Months 2024 Results
For the first nine months of 2024, Range Resources reported net income of $171.5 million, or $0.70 per diluted common share, compared to $561.1 million, or $2.27 per diluted common share, in the same period of 2023. The lower net income was primarily due to lower derivative fair value income (a non-cash adjustment related to the company’s derivatives) and lower realized prices, partially offset by higher production.
Revenue from the sale of natural gas, NGLs, and oil decreased 9% year-over-year, driven by an 11% decrease in average realized prices before cash settlements on derivatives, partially offset by higher production volumes. Including the impact of cash settlements on derivatives, revenue increased 1% compared to the first nine months of 2023.
Other highlights of the company’s financial and operating performance in the first nine months of 2024 included:
Range Resources also took the following actions in the first nine months of 2024 to enhance its balance sheet, return capital to investors, and preserve liquidity:
Natural Gas, NGLs, and Oil Sales, Production, and Realized Price Calculations
Range Resources’ revenues are primarily driven by changes in realized commodity prices and production volumes. The company’s average realized price (including all derivative settlements and third-party transportation costs) during the third quarter of 2024 was $1.67 per mcfe, unchanged from the same period in 2023. For the first nine months of 2024, the average realized price was $1.79 per mcfe, down from $1.89 per mcfe in the same period of 2023.
The company’s production for the third quarter of 2024 averaged 2.2 billion cubic feet equivalent per day (Bcfe/d), up 4% from 2.1 Bcfe/d in the same period of 2023. For the first nine months of 2024, production averaged 2.2 Bcfe/d, up 2% from 2.1 Bcfe/d in the same period of 2023.
Transportation, Gathering, Processing, and Compression Expense
Transportation, gathering, processing, and compression expense was $306.2 million in the third quarter of 2024, up from $277.2 million in the same period of 2023. This increase was primarily due to higher NGLs volumes and prices. For the first nine months of 2024, these expenses were $878.5 million, up from $830.9 million in the same period of 2023, also due to higher NGLs volumes and prices.
Derivative Fair Value Income
Derivative fair value income was $47.1 million in the third quarter of 2024, compared to $38.4 million in the same period of 2023. For the first nine months of 2024, derivative fair value income was $110.5 million, down from $530.1 million in the same period of 2023. This non-cash income or loss reflects changes in the fair value of the company’s commodity derivatives.
Brokered Natural Gas, Marketing, and Other Revenue
Brokered natural gas, marketing, and other revenue was $34.6 million in the third quarter of 2024, down from $44.6 million in the same period of 2023, due to lower broker sales volumes and prices. For the first nine months of 2024, this revenue was $101.2 million, down from $171.6 million in the same period of 2023.
Operating Costs per Mcfe
Range Resources’ operating costs per mcfe were as follows:
Cash Flows, Liquidity, and Capital Resources
Range Resources generated $726.6 million in cash from operating activities in the first nine months of 2024, down from $751.8 million in the same period of 2023, reflecting the impact of lower realized prices.
The company’s main sources of liquidity are cash on hand, internally generated cash flow from operations, capital market transactions, and its bank credit facility. As of September 30, 2024, Range Resources had approximately $1.6 billion in liquidity, consisting of $277.5 million in cash and $1.3 billion available under its credit facility.
Range Resources expects its 2024 capital program to be funded by cash flows from operations. The company used $432.3 million in cash for additions to natural gas properties in the first nine months of 2024.
The company’s bank credit facility had no outstanding borrowings as of September 30, 2024, and the borrowing base was $3.0 billion with aggregate lender commitments of $1.5 billion.
Dividends and Stock Repurchases
In the third quarter of 2024, Range Resources paid $19.3 million in dividends, or $0.08 per share. For the first nine months of 2024, the company paid $58.1 million in dividends, or $0.24 per share.
The company also repurchased $24.0 million of its common stock in the third quarter of 2024 and $44.1 million in the first nine months of 2024 as part of its stock repurchase program. At the end of September 2024, the company had approximately $1.0 billion remaining in its share repurchase authorization.
Outlook and Risks
Range Resources’ financial performance is primarily driven by commodity prices, which have been volatile in recent years. The company uses various strategies, including the use of commodity derivatives, to manage the risks related to price fluctuations. However, these arrangements can limit the benefit of price increases while offering protection in the event of price declines.
The company is also exposed to market risks related to changes in interest rates, though it currently has no variable-rate debt outstanding. Range Resources’ debt is primarily at fixed interest rates, which limits its exposure to interest rate movements.
Overall, Range Resources appears to be in a strong financial position, with substantial liquidity, a manageable debt load, and the ability to fund its capital program through cash flows from operations. However, the company remains exposed to the inherent risks of the oil and gas industry, including volatile commodity prices and potential operational challenges.